Recent Ecommerce Growth May Not Last
by James Sorensen
For months, the permanency of ecommerce growth post-COVID has been speculated. Early indications suggest much of these gains will be short-lived.
While ecommerce growth hasn’t yet reversed in the United States, the United Kingdom has already seen a steep drop from its gains early in lockdown. The trend is similar in Canada, where ecommerce sales have declined substantially from their height in May 2020.
WHY ISN’T ECOMMERCE STICKING?
There are many plausible explanations for why ecommerce growth is receding as lockdown measures soften. While the extent of the lockdown itself is a likely factor, negative online shopping experiences consumers have had – paired with the infrequency of transactions – are a more notable challenge.
As I discussed in my previous article, most shopping behavior is habitual. For new behaviors to become habits, they must have frequent cues or triggers and result in positive rewards or outcomes.
A recent Burke survey shows how ecommerce grocery shopping during lockdown happened relatively infrequently and resulted in an unsatisfactory experience:
The low frequency and negative outcome of the online shopping experience suggests the declines we have started to see in the UK will likely occur in the US and elsewhere.
WHAT CAN BE DONE TO PRESERVE, AND CONTINUE, ECOMMERCE GROWTH?
At the onset of the pandemic, many retailers heroically adapted their businesses to address the needs of shoppers in lockdown. With amazing speed, stores began implementing new measures to ensure their customers and employees were safe and that the items shoppers required were available, via both in-store and online delivery options. Consumers noticed and appreciated these measures. In fact, when asked which companies best handled lockdown, retailers were the top referenced sector.
While retailers are given credit for responding quickly to the pandemic, consumers are still not happy with the new shopping experience. Burke’s COVID-19 tracking study shows that out-of-stock product continues to be a major problem (56%) along with persisting shipping delays (53%). However, supply chain issues are not the only problem. Long-standing ecommerce shopping barriers that remain unaddressed are discussed in more depth in my previous post. If shoppers don’t have full confidence in the information they receive online, they often decide to go to a physical store to touch or see the product, or to talk to a store associate. When selling products online, the site and product detail pages (PDP) need to be designed according to the shopper’s decision process and the descriptions, images, videos and other enhanced content should strive to replace the full experience a shopper gets in the store.
Brands and retailers need to work on improving the online shopping experience. Supply chain challenges must be addressed, and the site experience and PDP must give shoppers more confidence when purchasing online.
When online retailers deliver a more satisfactory shopping experience, we can expect the frequency of online transactions to increase and ecommerce shopping will become more habitual. Until these barriers are addressed, however, we can expect ecommerce sales to decline as the effects of the pandemic recedes.
James Sorensen is a thought leader, helping shape the future of retail and shopping. As SVP and retail/shopper consultant, James helps clients innovate new omni-commerce retail experiences by first uncovering deep insights about the shopper, and then applying a proprietary innovation process that leads to pragmatic solutions that drive growth.
Interested in reading more? Check out James’ other articles:
COVID-19 is the Disruption Marketers Have Been Waiting for
In a Post-COVID World, Will Ecommerce Growth Continue?
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Sources: Feature Image – ©Jacob Lund – stock.adobe.com